November 25, 2025 • 43 mins
We often think of generosity as a sacrifice—but what if it’s actually one of the smartest ways to live? When we live with open hands, God not only blesses others through us, but He also transforms us in the process. On the next Faith & Finance Live, Chip Ingram joins Rob West to talk about The Genius of Generosity and why giving God’s way doesn’t lead to loss, but gain. Then, it’s on to your calls. That’s Faith and Finance Live—biblical wisdom for your financial decisions, weekdays at 4pm Eastern/3pm Central on Moody Radio.
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Episode Transcript
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S1 (00:08):
We often think of generosity as a sacrifice. But what
if it's actually one of the smartest ways to live? Hi,
I'm Rob West. When we live with open hands, God
not only blesses others through us, he transforms us in
the process. Chip Ingram joins us to talk about the
genius of generosity and why giving God's way doesn't lead
(00:28):
to loss, but to gain. Then it's on to your
calls at 800 525 7000. This is faith and finance. Live.
Biblical wisdom for your financial decisions. Well, it is an
absolute joy to welcome Chip Ingram to the program. He's
the founder, teaching pastor, and CEO of living on the edge,
(00:48):
a discipleship ministry dedicated to helping Christians live like Christians.
Chip is also the author of The Genius of Generosity
and numerous other books on Christian living and Living in discipleship. Chip,
great to have you with us today.
S2 (01:01):
Great to be with you, Rob. Thanks so much.
S1 (01:04):
Chip. Your book, The Genius of Generosity, opens with this
great story about your friend John and what you describe
as a secret pact. I'd love for you to share
how that experience influenced and ultimately transformed your understanding of
generosity and stewardship.
S2 (01:22):
Absolutely, John, in my mind, of course, back then he
was like this really, really older guy. He was like 70.
I'm in my late 20s. Brand new pastor, don't know
what I'm doing. He watches me for a couple of years,
invites me down. I would learn later. He was the
owner of Saville Dodge accounting firm, Big Glass Building. So
he has me come down and we have a lunch
(01:42):
in this place that makes me uncomfortable. Very high class. And,
you know, I come from very sort of middle class roots,
to say the least. And then he after lunch, he
has a little white box and he says, I'd like
you to open it. And I open the white box
and has a checkbook in it. He goes turn to
the back. I turn to the back and it says
pastor's discretionary fund. Then he looks at me and says, Chip,
(02:04):
you don't have to do this, but here's what I'd
like you to do. I came to Christ late. God's
given me money. I don't have a lot of time.
I go into the prisons once a month. But I
want you to take this checkbook, put it in your
back pocket every single day. And any time you see
a need that Jesus wants to meet, or you think,
as we get to know each other, I would want
(02:24):
to help. I just want you to write him a check.
This is back in the day when everyone used cheques. Yeah.
And so, you know, I'm feeling a little overwhelmed. And, gosh,
am I going to do that. And, um, and then
about three times a year, he would invite me down
and we would open the checkbook. And, you know, he's
an accountant, right? So, yeah, I was pretty in my finances.
(02:45):
If the bank said we were within about 20 bucks,
that's good for me. I'm not going to spend three
hours trying to figure out where that 20 bucks is, right?
But when I'm going to give it to an accountant
and it's his money, it was like I made sure
all the numbers really balanced. And, um, I guess what
I would say was the most unusual experience I've ever had.
I can still remember the first time I did it
(03:07):
in a grocery store of a woman who was abandoned
by her husband. Two kids in the cart crying, filled
her car with gas. We gave her food. Another family
who electricity was turned off and I would share these
stories with John and he was bold, cared not what
anyone thought. Exclusive. Top of the think of Dallas high
(03:28):
rise 34th floor restaurant. And we would I'd tell him
the story. He would lean back and I mean so embarrassing.
Praise the Lord. I mean really loud. I wanted to
hide under the table. And yet what I realized was, uh,
John was not cool. But what I realized over time
(03:48):
was I started sharing my life with John. I took
care of his finances better than my finances. It got
to be really fun every day wondering who's God going
to bring in my life today. And I mean, I
got to be the giver and joyful. Amazing. I mean,
meeting all kind of needs and then go to these
lavish lunches. And John and I, we had nothing in common.
(04:13):
I'm a young 29, 30 something very athletic guy. He's
a really old, nerdy accounting type, you know, bookkeeping type mentality.
And I got to where John became one of the
best friends, almost like a father figure to me. And, um,
the day came. It was about ten years later. This
(04:34):
is how slow I am, Rob. I remember preparing to
do a message and thinking, gosh, I think we're so
off on generosity and guilt and oughts and shoulds and
God brought that relationship back and it was like, oh,
so God does for everyone What John did for me
(04:56):
and the genius of generosity was born out of that relationship.
S1 (04:59):
Incredible. I'm confident there's some people in our listening audience
today that the light bulb just went off and they said,
I get it. I now understand stewardship. Folks, when we
come back, we're going to continue to unpack this. What
if God blesses you to increase your standard of giving,
not your standard of living? Back with Chip Ingram with
much more just around the corner. Stick around. So glad
(05:37):
to have you with us today on Faith and finance live.
What if generosity could be an adventure? We're talking about
the genius of generosity today with my friend Chip Ingram.
Chip's the founder, teaching pastor, and CEO of living on
the edge. You probably listened listen to it on your
local radio station. Or maybe you've read one of his books,
including the Genius of Generosity that we're discussing today. And Chip,
(06:00):
before the break, you told this incredible story of you
as a pastor in your 20s, understanding what it means
to be a steward as you had the opportunity to
give away someone else's money. And and that, I'm sure,
was a game changer for you as you approached managing
the resources of John completely different than you would have
(06:22):
your own. And we all sit in that posture today, right?
We manage money for the King of Kings.
S2 (06:27):
Yeah, we really do. And then, you know, the the
illustration kept growing because what I realized was one, it
was in spending his money his way that John and
I became close friends. And now what I've learned over
these years is when I do that with the Lord,
that generosity is the gateway to intimacy with God. And
it's just really an amazing experience to realize he's entrusted
(06:51):
me and everyone listening with various levels, but money and
time and resources and energy. And it went from obligation
to really what? You said it was an adventure. And
there was such joy. And I began to practice that
in my personal life and teach it through this little
book and some others. And it has it changed the whole.
(07:12):
In fact, I started doing a little study and, you know,
there's a lot of these going on right now. They're
called virtue studies. You know, the what's the medical issues
of being grateful or what's forgiving someone when people are generous?
If the Bible did not exist, the root word means
it's creative, it's life giving. It produces people that are
(07:33):
generous are happier people that are generous. They live longer.
People that are generous have better friends. People that are
generous have a life of joy that others don't. God
created us to depend on him and be stewards instead
of owners with an abundance mentality, not a scarcity. If
I give this away, who will take care of me?
(07:54):
And at the end of the day, Rob, I really think,
you know, one of the very first tests of the
children of Israel was trusting God. There's no better way
to see him show up than when we say, you know,
my time is yours, my money is yours. I will
give the first and the best, but not like writing
a bill. Yeah. And something I do. And, you know,
(08:16):
in my early years, I did it with five and
$20 bills. And, you know, as I've gotten older and
all my kids are out and I would encourage people,
I always carry cash now and now even I, when
I go on a trip, I'll put, you know, maybe
2 or $300 bills. And I just ask God, there's
there's going to be some desperate people. I mean, really,
(08:37):
really hurting. And, you know, maybe they're cleaning the bathroom
at an airport or you see someone tearing up as
you sit. I met a lot of airports, and and
you go and ask a few questions And all I
can tell you is when we begin to make generosity
a habit, it just becomes such a joyful part of
our life.
S1 (08:57):
Mhm. That is so powerful. I love what my friend
Todd Harper says. He says I've never met an unhappy,
generous person. And that's just so true. And then you
know our friend Chip Ron Blue, you know he says
my favorite way to give is cash. Just because you
find the person that feels unseen. And just what a
way to make them feel seen and to be blessed
(09:18):
by God. And what that does is it wells up
inside you is just incredible. Now it's so much more
than a moral virtue, chip. You call it genius. In
this little book, talk about how generosity uniquely connects us
to others.
S2 (09:32):
There's something that happens. Uh, think of all the patterns.
Number one, every time I make a financial decision, it's
a spiritual decision, according to Jesus. Because wherever my money goes,
that's really. That's where my heart will follow. So the
moment I give, something happened between me and God. I
recognize it's his. Second, when you give to another person,
(09:55):
it builds a bond. It might be a short bond.
It could be a long one. I remember many, many
years ago, just again, it's been a journey for me.
And I would get up super early with, you know,
had kids at the time and pastoring a large church
and a lot of demands. And so I would get
at this sort of bagel donut shop about 430 or
5 in the morning. We became friends, they would have
coffee ready, and they were going to be baking, and
(10:17):
I would sit in a corner and a homeless guy
would come in who just looked like he'd been on
drugs for 30 years and just stared and I'd say, hi.
No response, no response. I mean, months like this. And,
you know, just one day I, you know, I just thought, well,
I'm not getting through. And I ordered mine. And then
I said, hey, do you want something? No response. I
decided I got him a coffee and a bagel, put
(10:39):
it in front of him. No response. I sit behind
him over in the corner where I did my study.
I was working on sermons And then it was about
five minutes. And, you know, there was a window, it
was still dark. And I hear him say, do you
realize that Venus only looks like that 1 or 2
times in the whole year? I said, what? He said, yeah,
look out the window. And, you know, we think we
(11:02):
know where homeless people have come from. I mean, he
opened up and shared his story. We became friends. I
watched God just transform his life. It all began with
the cost of a cup of coffee and a bagel
that he didn't want. And I have just seen that
can happen. God has that all around us. If we
(11:24):
get our antenna up our eyes off our phone and saying, Lord,
what would you like to do? Who do you want
to love today through me? And I think it's those
little moments that then lead to bigger moments when he
taps you on the shoulder. And. And I remember not
all that long ago and he just said, hey, Chip,
you know, I know your financial planner thinks you're going
(11:44):
to live to your 100, and they've got all these
things planned out. Take this in a good way, Rob.
I know you're the financial planner guy, but I got news.
Most people are not going to live to be 100. Yeah.
And and I just I start meeting people like all
my retirement are what's set aside for retirement. That can
only be used for if I live to 100 or take.
Now we have to plan. But God's tapped me on
(12:06):
the shoulder now and then said, you know what, Chip?
This is an opportunity and a need, and I want
to test you so your security is not there. I
want you to give a six figure gift. I said, well, Lord,
I don't have six figures. And he says, well, over
here in your retirement, do you think I could fill
that in? Well, of course you could, Lord. And so
I think it's those moments where it might be $20
(12:29):
cash one day, and it might be thousands of dollars
where God just keeps reminding us. I want you to
know I've got plenty. Yeah. The story with John I
have to tell you is, you know, uh, you know,
I would get my bank statements and it was like, miraculous.
You know, I'd go meet for lunch and then I'd
get my bank statement. I had $5,000 in it again.
(12:50):
Then I'd give it all away and I'd go for lunch,
and then I'd have $5,000. It didn't matter how much
I spent or what I did, it always got filled up.
And I it just reminded me that when God can
find people that are generous and we give away our
money and our time, and we do it with a
heart not to earn or prove or compare, but just,
(13:11):
oh Lord, you love people. He just has an amazing
way to keep refilling up because he can't find all
that many people who recognize it's all his and are
open handed with it. And when he does, he longs
to bless.
S1 (13:24):
Mm. Boy, he sure does. We've got just about 30s
left for someone out there today who perhaps is at
the other end of the spectrum. They feel like they
don't have much to give, and they want to honor God.
What would you say to that person?
S2 (13:38):
Start small. Um. It's your view of God that needs
to change, not your circumstances. I thought honestly that once
I get rich, someday, if I ever did, or if
I was more holy, then I'll start to give. You
need to practice generosity today. Do what you can, where
you're at, and watch God grow your heart, and often
(13:59):
will take care of a lot of other needs as well.
S1 (14:02):
The genius of generosity is that when we give, we
don't lose. We actually gain. God designed generosity to free
our hearts, deepen our faith, and multiply joy. What a treat.
Thanks for being with us, my joy.
S2 (14:14):
Bye bye.
S1 (14:15):
That's Chip Ingram, founder, teaching pastor, and CEO of living
on the edge. Learn more at living on the edge org.
Back with your questions after this, stick around.
S3 (14:37):
The opinions offered during this program represent the personal or
professional opinions of the participants, given for informational purposes only.
Any information provided is not intended to replace advice from
a financial, medical, legal or other professional who understands your
specific situation.
S4 (15:01):
So glad to have you with us today on Faith
and finance live.
S1 (15:04):
I'm Rob West. We're taking those calls and questions from
you at 800 525 7000. That's 800 525 7000. We've
got some lines open. You know, this is a bit
of a wonderful but unusual week, at least from a
broadcast standpoint. And reason being, we're off our rhythms, right?
A lot of us wrapping up work. Some may already
(15:25):
have some time off, others planning for maybe doing the
last minute cleaning before a big group arrives at your home, uh,
for the Thanksgiving holiday. Uh, and as a result, it
changes our listening habits on the radio. And so there's
going to be a little more room today for you
to get that question. And perhaps you've not been able
(15:46):
to get through in the past. Well, today is an
opportunity for you. We've got some lines open. And so
if you have a financial question, something you've been wrestling
with in your financial life and you'd like to talk
about it, I'd love to chat about it with you.
Just call 800 525 7000. Again that number is 800
525 7000. We'll get to as many calls as we
(16:06):
can between now and the end of the broadcast before
we head to those phones in the news today. Well,
mortgage rates have, uh, well, they're approaching 6%. We've actually
heard that there are some rates out there at 5.99%
for a 30 year fixed rate, uh, 5.5 for a
(16:27):
15 year. Now, most of them, like if you go
to Bankrate or NerdWallet, you'll see them around, uh, six
and a quarter, but even six and a quarter, uh,
we haven't seen these rates in quite a while, and
that's clearly catching the attention of a lot of homeowners
and potential buyers, not to mention those interested in refinance.
Here's a few things to keep in mind. First of all,
(16:49):
lower rates, of course, can reduce your monthly payment or
shorten your payoff timeline. Improving long term stability. Refinancing only
makes sense if the savings outweigh the closing costs, so
run those numbers carefully. I generally say you want a
point and a half at a minimum in terms of
(17:09):
reduction on that interest rate, and you need to be
willing to stay in that home five years. Now, can
you make the numbers work if you stay in the
home three years, perhaps. Uh, what if you only get
a 1% reduction, you still might be able to make
it work, but you're going to need to really crunch
those numbers. That's why I think 1.5% in five years
is a better target. And here's why. You know, the
(17:31):
cost of the refinance can easily run you 3%. So
on a quarter of $1 million mortgage. I mean, we're
talking 7500. If it's not 3% and it's 4%, well,
that's $10,000. And you need to be able to have
$10,000 in savings in terms of interest before you sell
that property. Now it's easy to say, well, you know,
(17:54):
on a 30 year mortgage, even if I get three
quarters of a point, I'm going to save tens of
thousands of dollars. Yeah, but that's assuming you stay there
for the next 30 years. Most people don't do that.
And so you need to make sure that you're going
to be there long enough, and you'll get enough interest
savings to cover the cost of the refi, or else
you might as well not even do it. So just
(18:14):
keep that in mind as you're thinking through it. Also,
here's something people miss. You know, in an amortized mortgage,
the vast majority of your payment at the beginning of
your amortization schedule. So when you start those 30 years
is going to interest. Very little is going to principal.
And then over time it flips in that last payment
(18:34):
you make, you have a very small amount going to
interest and almost the whole check going to principal. That's
just the way an amortized loan works. So what does
that mean? Well, if you're five years into that mortgage
and you've started to move in the direction of a
larger portion going to principal out of every payment, and
then you start that over, well, you're really resetting that.
(18:56):
And that's going to hurt you in the long run,
because again, you're beginning back in that place where the
vast majority is going to principal. So what do you
do about it? Well, one option is you go ahead
and get that 30 year mortgage five years in, even
though you only had 25 left, but pay it like
it's a 25. So that would be where you'd go online.
(19:17):
You'd find a free mortgage calculator to run an amortization schedule.
You'd put in your loan balance and your interest rate
and all the details, and then you'd say, how much
do I have to add extra per month to make
this 35 or 25 or this 30 year, a 25
year your mortgage, it would tell you, and then you
could just make that your monthly payment. Now, the benefit
(19:38):
of still having the 30 year mortgage is if you
got into a real financial hardship, you could drop back
to that smaller 30 year payment, which is a real benefit,
because if you were in a really tight spot, you'd
be glad you had the option to make a lower payment.
So just a few things to keep in mind. Now,
if you're buying, don't let lower rates tempt you into
(19:58):
stretching your budget. It's easy to do. Keep that payment
in a range you can sustain with peace. That's generally
no more than 25% at the most 30% of your
take home pay toward principal interest, taxes, and insurance. Uh, finally,
I would say consider consider the long term implications. You know,
a lower rate is helpful, but a sound financial plan
(20:21):
matters more than a moment in the market. So just
take it with a grain of salt, recognizing, okay, rates
are headed down. This is a good sign for me
if I've either been on the sideline waiting or I'm
up near 8%, and if I could get it at six. Uh,
you know, that's two points lower, and especially if I'm
(20:41):
planning to stay put for a while or, you know,
I want to accelerate the pay off. Uh, you know,
all of those are good things that will work in
your favor. Where are rates headed from here? Nobody knows. Uh,
you know, most estimates are that we'll finish, uh, 20, 26.
You know, maybe in the mid fives. So if we're
at six right now, we're not expected to go a
(21:01):
whole lot lower. A lot of that is just going
to be a result of inflation. And what happens with
interest rates and the Federal Reserve. Uh, a lot of
people counting on the fact, including the market, that we're
going to get another rate reduction here in December. It
remains to be seen. Uh, whereas it was pretty much
a foregone conclusion. That's not the thinking necessarily right now.
(21:22):
It may happen and may not. A lot of economists
put it at about 50%. So we'll certainly keep an
eye on that. All right. Here's what we're going to do.
We're going to take a break. All the lines nearly full.
So we've got a lot of great questions coming up.
We will dive into those right after this break. And
we're going to take as many calls as we can
between now and the end of the program. So hopefully
(21:42):
we can help you think about applying God's wisdom to
your financial decisions. I'm Rob West. This is faith and
finance live here on Moody Radio. Quick break and then
back with much more. Stay with us. Thanks for joining
(22:10):
us today on Faith and Finance Live. Let's dive into
your questions. Today we're headed to Illinois and Alaska. Minnesota.
But first green Bay, Wisconsin. Hi, Dan. Go ahead.
S5 (22:20):
Well good afternoon, Rob. Thank you for taking my call.
I really appreciate faith and finance and how your entire
team ministers to so many people.
S1 (22:28):
Well thank you, Dan. That's very kind.
S5 (22:30):
You're more than welcome. Let me give you a little background.
Then I'll ask my question. My wife and I are
two years of age, and we're planning on retiring at
age 65. Our home, our automobiles are free and clear.
We also have $100,000 in liquid cash. And by God's grace,
we've accumulated just over $1 million in our IRAs. 300,000
of that is invested in Roth. And the balance is
(22:52):
in a traditional IRA. 100% of those accounts are invested
in mutual funds at a moderate level of risk. And
our question is simply this with the market at record highs, tariffs,
inflation and just the overall volatility in the market, how
concerned should we be of a market correction and how
or and should we consider diversifying with bonds. Or should
(23:15):
we simply adjust our existing mutual funds with a more
conservative approach given our age?
S1 (23:21):
Yeah. Well, it's a great question, Dan, and I really
appreciate the thorough nature of it. Um, when you say, um,
you essentially with your million dollar portfolio, I think you said, um,
you have all of it in mutual funds. And am
I hearing that those are all stock funds, or do
(23:41):
you feel like that some of them at least are balanced,
meaning they have some bond exposure?
S5 (23:46):
No, they have zero bond exposure. There are 90%. I
think it's 92% are all in equities. It's an American
growth fund is what it is.
S1 (23:54):
Okay. Got it. Yeah. Yeah I think this is a
great opportunity for you to begin to change your allocation. Um,
you know, because when we get to this point, I mean,
you've accumulated quite a bit of a nest egg and
you want to think about not only continuing to grow
it because one of the risks you have moving forward
(24:15):
is what's called longevity risk, meaning you're going to outlive
your money. And one of the ways we manage that
is by making sure your withdrawal rate is appropriate. And
we could talk about that, But you've probably heard me
say that, you know, a typical, at least based on
the studies that were done by a guy named Ben
Gin a few decades ago, is where we got the 4%
(24:36):
rule that if you take only 4% a year. So,
you know, in your case, we'd be talking, uh, you know,
40,000 a year. If we take no more than 4%,
you know, you should be able to maintain that principle
balance over time and basically have the full amount available
to pass on to heirs or give away at death.
And he recently revised that, I think his new number
(24:58):
when his new book that just came out is, is 4.7%. Now,
that's just a rule of thumb. It's all it is.
It doesn't mean that you're guaranteed anything. It doesn't mean
it's the right withdrawal rate for you. I think it's
a matter of just really thinking through, you know, what
is appropriate for us. Um, you know, given our needs. Um,
(25:18):
but the second way we manage that is in addition
to making sure, you know, that we have the appropriate
withdrawal rate. I think the other piece is just making
sure we have the right mix of investments, making sure
that we're not too aggressive. And, you know, at 60,
you know, we used to use 100 minus your age.
People are living longer. So the new rule of thumb
(25:40):
is 110 minus your age. That's the portion the percentage
that should be in stocks and then the remainder in bonds.
So let's call it I know you're 62 but let's
call it 60. That would be a 50 over 50
portfolio where you got 50% in stocks, 50% in bonds.
And you know the nice part about that is, you know,
so let's say, you know, there was a market crash.
(26:03):
And usually I mean, we're talking, you know, a 20%
decline in the market in a very short period of time. Uh,
if that were to happen and you're 50% bonds, 50% stocks,
you know, all the all of a sudden that 20%
quote unquote crash, you know, only results in you being
down 10%. Now that's significant. That's $100,000 on your portfolio.
(26:26):
But it's a paper loss. And because you're drawing a
with a very modest amount, you're just pulling the income
anyway largely off the bond portion. And you wouldn't you
or your advisor wouldn't need to sell any of those
stocks that are down during that market crash. And 100%
of the time, because we're basically sitting at all time
(26:49):
highs right now, 100% of the time. We've had corrections
or crashes in the past, whether it's 1929, 1987, the.com
bubble burst. And, you know, in 2000, um, you know,
the pandemic, uh, 2008, 2009, the great financial recession. Um,
(27:09):
you know, in every one of those cases, the market
has recovered. And what you would be able to do
at that point is let your portfolio recover over time
without selling anything. And I think that's one of the reasons,
especially given where we are right now and all the
reasons you mentioned to be concerned about where the market
might be headed from here, uh, for you to begin
to transition to a more properly diversified portfolio that fits
(27:34):
with your age so that, you know, you still get
plenty of upside if the market continues to do well,
but you're adding some more income with the bonds, you know,
and in that bond portion, it may not be all bonds.
You could have some laddered CDs, you could have some
precious metals. You could even have, you know, somewhere between
(27:55):
1 and 3% and bitcoin, uh, you know, because it
acts kind of like a store of value. And so
there are other ways, even some real estate through real
estate investment trusts, all of that could fit into that
more fixed income portion that, um, you know, I think
could round out a nice portfolio, take some of the
pressure off you. And here's one of the keys is
(28:17):
you'd have to just go ahead and accept that at
some point, you know, during the next however long the
Lord has for us. But it could, you know, easily
be three decades or more. There's going to be a
major correction, if not a crash. And the key is
you got to be ready for it and know that
you're prepared for it. And that's why you've invested the
way you have such that you wouldn't feel compelled to
(28:40):
go in and start selling a bunch of things while
they were down. You would just need to already be,
you know, in your mind, settled around the idea that, no,
we're taking a rules based approach to this. We like
what we own. We like our mix of stocks and bonds.
And so we're going to weather the storm, and we're
going to trust that history is going to repeat itself
in this market eventually will recover and move to new highs.
(29:02):
But give me your thoughts on all that because I
know it was a lot.
S5 (29:06):
No, it was a lot. But it's fantastic. And it
kind of confirms, uh, much of what I've been, I'll say, considering.
And it just makes me nervous. I think that, you know, I,
I know that God's really blessed us. And as far
as we're concerned, you know, we want to be able
to honor God in and all that he has, in
(29:26):
a sense, put us in charge of and just to
be really good stewards. So I think diversifying that, uh, with,
I'll say, a 6040 or 5050 bond at this point
in time at age 62 is probably a good idea.
S1 (29:38):
Yeah, yeah, I agree, I think that'll serve you well. Also,
go back and listen to, uh, you know, the interview
I did with Mark Biller late last week, you know,
he was talking about how he's expecting and and actually,
there's a great article on this at Sound Mind Investing
org that I think you might enjoy. Um, it's called, uh,
(30:00):
bulls and bears, cyclical and secular. And what he's talking
about there is really their approach to what he's expecting
in the bond market over the next decade. He's expecting
the next 1 to 3 years as rates are coming
down to be good, but perhaps not as good long term.
And so there's some ways you can take that bond
portion and add some other things in like precious metals and,
(30:23):
you know, real estate, you know, that might round that out.
But I think that article is sound mind investing. Aug
could be helpful. The other piece is and by the way,
that was November the 20th. The other piece is you
could always connect with a certified Kingdom advisor to take
over management of this. If you'd be, you know, at
this point happier with somebody else that could take responsibility,
you'd be delegating it to them. You'd have to be
(30:44):
comfortable with that and you'd pay for it. But I
think with this nest egg, you might have a lot
more peace of mind. If you wanted to do that.
Just go to find a.com. Dan, thanks for your kind
remarks about the program and for joining us today. God
bless you. We'll be right back. Great to have you
(31:09):
with us today on Faith and Finance Live. We're going
to get to as many calls and questions as we
can today. It was a big day here at Faith
fi we got from the printer, uh, the first copy
of our ultimate Treasure, my new 21 day devotional that
comes out early next year. Now, it wasn't the actual book.
It was the first print print run for us just
(31:30):
to look at, uh, you know, all the margins and
have one final look at it before it goes to press.
And and then we'll get the actual hardback books, uh,
in late January. But I can't wait for you to
get your hands on it. It's, uh, really the first
time I've put together a collection of what I believe
are the foundational ideas in Scripture that I believe everybody
(31:53):
needs to know, not because it comes from me, but
because it's found in God's Word. In terms of being
a faithful steward. It's really these 21 bottom lines. And
we've organized it as a 21 day devotional so that
if you spend 21 days journeying with us through God's
Word and it is full of Scripture, I mean, we're
all over the Old and New Testament over these 21 days,
(32:15):
but I think you'll come away with an understanding of
the heart of God from Scripture related to your role
as a steward of God's resources. It's called our ultimate treasure,
a 21 day Journey to faithful stewardship, and it'll be
out in the first part of next year by late January.
And if you make a gift to faith by here
(32:36):
before the end of the year, a gift of any amount,
we will be able to send you a copy. And
so just head to our website. Faith that's faithful. Not
only will you get a copy of our Ultimate treasure,
but every gift is doubled before 1231 because of some
generous friends that are matching every gift. It's going to
(32:57):
be beautiful. I mean, this hardback devotional is one that
you could put out on the coffee table in your
home and, uh, it would be something people would enjoy
flipping through as well. So really excited to get it
in your hands. All right, back to the phones. We
go Minnesota Diane. Go ahead.
S6 (33:14):
Thank you so much. I sure appreciate your program and
your amazing financial expertise in all of these matters. So
my my question is in reference to, um, my husband
and I are retirement age and we have four different
retirement plans. Three of them are through an employer and
the other one is through an A Vanguard IRAs. So
(33:35):
we are wondering, um, we it's totals around 200,000. Is
it wise to consolidate them? And if yes, is it
wise to consolidate them into the vanguard IRA?
S1 (33:49):
Yeah. Well, let's start with the first part of that. First. Yes.
As you get close to retirement, in my view, consolidating
accounts is almost always a smart move. It just makes everything, Diane,
easier to track, easier to manage, and ultimately easier to
withdraw from once you actually retire. So I think it's
(34:11):
a great move, not to mention, it's easier to make
sure that you have the right mix of investments, because
when you have multiple accounts and each have their own
investments in them, you could end up not hitting the
right target mix of investments that's appropriate for your age
and risk tolerance. Just because it's a little harder to
do when you've got to factor in the investments across
(34:33):
multiple accounts versus everything being in one and being able
to get, you know, see it all in one place,
including how the various investments bucket out in terms of
bonds and stocks and precious metals and other types of investments. So, yes,
I like the idea of consolidation. Now with retirement accounts,
they have to stay individual. So your 401 K could
(34:56):
go in your IRA, but your husband's 401 K could
not go in your IRA. So you're probably going to
end up with it at a minimum two accounts. But
any of the accounts that are titled in your name
could be consolidated into one now. Does it make sense
to use the Vanguard IRA? Well, Vanguard is a solid,
(35:16):
low cost provider. They have great index funds and and
excellent retirement tools. Um, you know, they're they're one of
the oldest in this space in terms of the low
cost providers. But I think that's really going to come
down to Diane. How do you want to manage these funds?
Are you all going to be the ones to make
the buy and sell decisions? And if so, you could
(35:39):
use Vanguard. You could use fidelity. You could use Schwab.
Any of those would work. Um, I think you really
need to make the the management decision first, because if
you decided to use an investment advisor, someone who would
take discretionary investment authority over the account charged as a fiduciary,
meaning they have to put your interests first. They have
(36:01):
to understand your goals and objectives and risk tolerance and
income needs and all those things. But then he or
she would make the buy and sell decisions for you. Well,
then they're going to want to open those IRA accounts,
if that's what they are at, wherever they custody their
client's assets. And then you're going to roll everything over there.
(36:22):
So before you start consolidating everything in Vanguard, I would
make that decision about, you know, whether you're going to
manage it yourself or have somebody else do it. Does
that all make sense?
S6 (36:32):
Certainly does. Is there, if you don't mind a follow
up question, is there a threshold of a dollar amount
where it would be wise to go to a financial
manager or financial planner or.
S1 (36:43):
Yeah, I mean, I think once you get over 100,000,
it's probably worth thinking about how many investment advisors are
going to have minimums, and some of them are going
to be 250,000. Some of them might be a half million.
You might even find some advisors that have a minimum
of a million or more. But there's plenty that would
take the account, you know, starting at 100,000 and up,
(37:04):
typically under 100,000. You know, most investment advisors. Their models
just don't work for them to manage it for you.
Because the fees are based on the assets under management.
There's just not a fee, enough fees there, and they
can only take so many clients. I mean, a typical
advisor can only serve 50 families on average, and so
there's only so many slots. Um, so what I would
(37:27):
do is, you know, if you've got over 100, certainly
if you've got over 200,000 in total among all the
investment accounts, then I would say, yes, it's time to
start looking at an advisor and I'd go to find a.
Com maybe interview 2 or 3 certified Kingdom advisors there
in Minnesota to find the one that's the right fit.
S6 (37:47):
Perfect. Okay. Thank you so much. God bless. That was
very helpful.
S1 (37:50):
Good. I'm glad to hear it Diane. Yeah. Happy Thanksgiving.
Thanks for your call today. Uh, out to beautiful Alaska. Connie.
Go ahead.
S7 (37:59):
Good morning.
S1 (38:00):
Hi, there.
S7 (38:02):
Hi. Well, you are talking with someone who is very
uninformed compared to your last two callers. My husband and
I are both 70. My husband is retired and a
cancer survivor. I am still working and probably will be
for the next five years, maybe a little longer. And I,
(38:25):
we have been blessed to pay off our home, pay
off our vehicles, and now have a nest egg of
about 350,000. Two and a half of that is in
CDs and the other is in cash. And at this
point I don't. I've not been raised around the kind
(38:49):
of thing that you're talking about. So I don't know
anything about stocks or bonds or or that type of thing.
I'm just wondering if we should be taking any risk
at this point, or if we should just go on
with these place money the way it is currently placed.
S1 (39:07):
Yeah, it's a great question. And, you know, the ultimately
you are the steward, Connie, you and your husband. And
so before the Lord, you all need to make these
decisions as to how you want to manage God's money.
The benefit of investing is investing is ownership. So you're
owning real companies. And, you know, those companies are providing
(39:27):
goods and services for hopefully, the good and flourishing of mankind.
Of others, it's a part of God's design. Uh, business
is what provides capital or investment is what provides capital
to business. Uh, you know, and that's what, uh, it
creates a virtuous cycle. And bonds are essentially debt where
(39:49):
you're being, you know, loaning money and they're paying you
an interest rate. But in either case, you're putting God's
money to work to be productive, hopefully in, in God
honoring ventures. And you get a return from that. And
what that does is it accomplishes two things. Number one
is there's a loss of purchasing power that's happening every day.
(40:12):
You know, your dollar is under a mattress and maybe
that's not where it is, but let's say it is
for my example here because with inflation and we could
talk about whether or not there should be inflation. But
there is, there always has been for you know, and
it's getting, it's higher than it has been in the last,
you know, 20 or 30 years right now with inflation,
(40:32):
you're the purchasing power of your dollars are losing purchasing
power over time. So one of the benefits of investing
is you offset that by growing it number one. And
number two is you have something called a longevity risk,
which is the idea that people are living longer. I mean,
once you're in your 70s as a 70 year old
woman living in the United States of America, you have
(40:56):
a 1 in 3 chance of living to age 90.
You have a 1 in 10 chance of living to
age 95. So we're talking about you. This money needing
to last, you know, 20 to 25 years, potentially or more. Now,
unless the Lord, uh, you know, comes back and then
it doesn't matter. But if he doesn't and he has
(41:16):
a plan for you here, uh, that could be well
into your 90s. And so you can still take a
long term perspective even in your 70s. Now, at 70
years old, what would be the right mix of investments? Well,
as a starting point, and that's all it is. It
would probably be, you know, this idea that you'd put
20 to 40% in stocks for some growth and then
(41:39):
you'd put the the balance, call it 60 to 80%
in bonds or cash for safety and income. And in
that bond portion, maybe you'd add in a little bit of, uh,
precious metals and, you know, maybe even some real estate
through a real estate investment trust, which you can buy
and sell like a stock. But that would be, generally speaking,
(42:01):
what's considered a properly diversified portfolio, where you take what
God has given you, you'd have a portion of it
that's growing to offset that longevity risk and inflation. And
then you'd be generating some income in the bonds and
cash portion, and you'd you'd still be relatively safe. So
even if the market was down 20 or 30%, your
portfolio might be down 5 to 10. Does that make sense?
S8 (42:25):
It's beginning to.
S1 (42:27):
Okay, here's what I want to do. I'm going to
send you a book called The Sound Mind Investing Handbook.
And maybe, uh, you know, over this next, uh, five
weeks of Thanksgiving and Christmas, you and your husband sit
down and read it, think through it, and then why
don't we talk a bit more in the new year?
And the other option is you can connect with a
certified Kingdom advisor. And we have some great ones in Alaska.
(42:48):
Hang on the line. We're going to get your information.
I'll send you that book. God bless you, Connie. Happy Thanksgiving.
Faith and finance is a partnership between Moody Radio and
Faith by Taylor, Tara, Josh and Dan, the amazing team today.
We'll see you next time.
We often think of generosity as a sacrifice. But what
if it's actually one of the smartest ways to live? Hi,
I'm Rob West. When we live with open hands, God
not only blesses others through us, he transforms us in
the process. Chip Ingram joins us to talk about the
genius of generosity and why giving God's way doesn't lead
(00:28):
to loss, but to gain. Then it's on to your
calls at 800 525 7000. This is faith and finance. Live.
Biblical wisdom for your financial decisions. Well, it is an
absolute joy to welcome Chip Ingram to the program. He's
the founder, teaching pastor, and CEO of living on the edge,
(00:48):
a discipleship ministry dedicated to helping Christians live like Christians.
Chip is also the author of The Genius of Generosity
and numerous other books on Christian living and Living in discipleship. Chip,
great to have you with us today.
S2 (01:01):
Great to be with you, Rob. Thanks so much.
S1 (01:04):
Chip. Your book, The Genius of Generosity, opens with this
great story about your friend John and what you describe
as a secret pact. I'd love for you to share
how that experience influenced and ultimately transformed your understanding of
generosity and stewardship.
S2 (01:22):
Absolutely, John, in my mind, of course, back then he
was like this really, really older guy. He was like 70.
I'm in my late 20s. Brand new pastor, don't know
what I'm doing. He watches me for a couple of years,
invites me down. I would learn later. He was the
owner of Saville Dodge accounting firm, Big Glass Building. So
he has me come down and we have a lunch
(01:42):
in this place that makes me uncomfortable. Very high class. And,
you know, I come from very sort of middle class roots,
to say the least. And then he after lunch, he
has a little white box and he says, I'd like
you to open it. And I open the white box
and has a checkbook in it. He goes turn to
the back. I turn to the back and it says
pastor's discretionary fund. Then he looks at me and says, Chip,
(02:04):
you don't have to do this, but here's what I'd
like you to do. I came to Christ late. God's
given me money. I don't have a lot of time.
I go into the prisons once a month. But I
want you to take this checkbook, put it in your
back pocket every single day. And any time you see
a need that Jesus wants to meet, or you think,
as we get to know each other, I would want
(02:24):
to help. I just want you to write him a check.
This is back in the day when everyone used cheques. Yeah.
And so, you know, I'm feeling a little overwhelmed. And, gosh,
am I going to do that. And, um, and then
about three times a year, he would invite me down
and we would open the checkbook. And, you know, he's
an accountant, right? So, yeah, I was pretty in my finances.
(02:45):
If the bank said we were within about 20 bucks,
that's good for me. I'm not going to spend three
hours trying to figure out where that 20 bucks is, right?
But when I'm going to give it to an accountant
and it's his money, it was like I made sure
all the numbers really balanced. And, um, I guess what
I would say was the most unusual experience I've ever had.
I can still remember the first time I did it
(03:07):
in a grocery store of a woman who was abandoned
by her husband. Two kids in the cart crying, filled
her car with gas. We gave her food. Another family
who electricity was turned off and I would share these
stories with John and he was bold, cared not what
anyone thought. Exclusive. Top of the think of Dallas high
(03:28):
rise 34th floor restaurant. And we would I'd tell him
the story. He would lean back and I mean so embarrassing.
Praise the Lord. I mean really loud. I wanted to
hide under the table. And yet what I realized was, uh,
John was not cool. But what I realized over time
(03:48):
was I started sharing my life with John. I took
care of his finances better than my finances. It got
to be really fun every day wondering who's God going
to bring in my life today. And I mean, I
got to be the giver and joyful. Amazing. I mean,
meeting all kind of needs and then go to these
lavish lunches. And John and I, we had nothing in common.
(04:13):
I'm a young 29, 30 something very athletic guy. He's
a really old, nerdy accounting type, you know, bookkeeping type mentality.
And I got to where John became one of the
best friends, almost like a father figure to me. And, um,
the day came. It was about ten years later. This
(04:34):
is how slow I am, Rob. I remember preparing to
do a message and thinking, gosh, I think we're so
off on generosity and guilt and oughts and shoulds and
God brought that relationship back and it was like, oh,
so God does for everyone What John did for me
(04:56):
and the genius of generosity was born out of that relationship.
S1 (04:59):
Incredible. I'm confident there's some people in our listening audience
today that the light bulb just went off and they said,
I get it. I now understand stewardship. Folks, when we
come back, we're going to continue to unpack this. What
if God blesses you to increase your standard of giving,
not your standard of living? Back with Chip Ingram with
much more just around the corner. Stick around. So glad
(05:37):
to have you with us today on Faith and finance live.
What if generosity could be an adventure? We're talking about
the genius of generosity today with my friend Chip Ingram.
Chip's the founder, teaching pastor, and CEO of living on
the edge. You probably listened listen to it on your
local radio station. Or maybe you've read one of his books,
including the Genius of Generosity that we're discussing today. And Chip,
(06:00):
before the break, you told this incredible story of you
as a pastor in your 20s, understanding what it means
to be a steward as you had the opportunity to
give away someone else's money. And and that, I'm sure,
was a game changer for you as you approached managing
the resources of John completely different than you would have
(06:22):
your own. And we all sit in that posture today, right?
We manage money for the King of Kings.
S2 (06:27):
Yeah, we really do. And then, you know, the the
illustration kept growing because what I realized was one, it
was in spending his money his way that John and
I became close friends. And now what I've learned over
these years is when I do that with the Lord,
that generosity is the gateway to intimacy with God. And
it's just really an amazing experience to realize he's entrusted
(06:51):
me and everyone listening with various levels, but money and
time and resources and energy. And it went from obligation
to really what? You said it was an adventure. And
there was such joy. And I began to practice that
in my personal life and teach it through this little
book and some others. And it has it changed the whole.
(07:12):
In fact, I started doing a little study and, you know,
there's a lot of these going on right now. They're
called virtue studies. You know, the what's the medical issues
of being grateful or what's forgiving someone when people are generous?
If the Bible did not exist, the root word means
it's creative, it's life giving. It produces people that are
(07:33):
generous are happier people that are generous. They live longer.
People that are generous have better friends. People that are
generous have a life of joy that others don't. God
created us to depend on him and be stewards instead
of owners with an abundance mentality, not a scarcity. If
I give this away, who will take care of me?
(07:54):
And at the end of the day, Rob, I really think,
you know, one of the very first tests of the
children of Israel was trusting God. There's no better way
to see him show up than when we say, you know,
my time is yours, my money is yours. I will
give the first and the best, but not like writing
a bill. Yeah. And something I do. And, you know,
(08:16):
in my early years, I did it with five and
$20 bills. And, you know, as I've gotten older and
all my kids are out and I would encourage people,
I always carry cash now and now even I, when
I go on a trip, I'll put, you know, maybe
2 or $300 bills. And I just ask God, there's
there's going to be some desperate people. I mean, really,
(08:37):
really hurting. And, you know, maybe they're cleaning the bathroom
at an airport or you see someone tearing up as
you sit. I met a lot of airports, and and
you go and ask a few questions And all I
can tell you is when we begin to make generosity
a habit, it just becomes such a joyful part of
our life.
S1 (08:57):
Mhm. That is so powerful. I love what my friend
Todd Harper says. He says I've never met an unhappy,
generous person. And that's just so true. And then you
know our friend Chip Ron Blue, you know he says
my favorite way to give is cash. Just because you
find the person that feels unseen. And just what a
way to make them feel seen and to be blessed
(09:18):
by God. And what that does is it wells up
inside you is just incredible. Now it's so much more
than a moral virtue, chip. You call it genius. In
this little book, talk about how generosity uniquely connects us
to others.
S2 (09:32):
There's something that happens. Uh, think of all the patterns.
Number one, every time I make a financial decision, it's
a spiritual decision, according to Jesus. Because wherever my money goes,
that's really. That's where my heart will follow. So the
moment I give, something happened between me and God. I
recognize it's his. Second, when you give to another person,
(09:55):
it builds a bond. It might be a short bond.
It could be a long one. I remember many, many
years ago, just again, it's been a journey for me.
And I would get up super early with, you know,
had kids at the time and pastoring a large church
and a lot of demands. And so I would get
at this sort of bagel donut shop about 430 or
5 in the morning. We became friends, they would have
coffee ready, and they were going to be baking, and
(10:17):
I would sit in a corner and a homeless guy
would come in who just looked like he'd been on
drugs for 30 years and just stared and I'd say, hi.
No response, no response. I mean, months like this. And,
you know, just one day I, you know, I just thought, well,
I'm not getting through. And I ordered mine. And then
I said, hey, do you want something? No response. I
decided I got him a coffee and a bagel, put
(10:39):
it in front of him. No response. I sit behind
him over in the corner where I did my study.
I was working on sermons And then it was about
five minutes. And, you know, there was a window, it
was still dark. And I hear him say, do you
realize that Venus only looks like that 1 or 2
times in the whole year? I said, what? He said, yeah,
look out the window. And, you know, we think we
(11:02):
know where homeless people have come from. I mean, he
opened up and shared his story. We became friends. I
watched God just transform his life. It all began with
the cost of a cup of coffee and a bagel
that he didn't want. And I have just seen that
can happen. God has that all around us. If we
(11:24):
get our antenna up our eyes off our phone and saying, Lord,
what would you like to do? Who do you want
to love today through me? And I think it's those
little moments that then lead to bigger moments when he
taps you on the shoulder. And. And I remember not
all that long ago and he just said, hey, Chip,
you know, I know your financial planner thinks you're going
(11:44):
to live to your 100, and they've got all these
things planned out. Take this in a good way, Rob.
I know you're the financial planner guy, but I got news.
Most people are not going to live to be 100. Yeah.
And and I just I start meeting people like all
my retirement are what's set aside for retirement. That can
only be used for if I live to 100 or take.
Now we have to plan. But God's tapped me on
(12:06):
the shoulder now and then said, you know what, Chip?
This is an opportunity and a need, and I want
to test you so your security is not there. I
want you to give a six figure gift. I said, well, Lord,
I don't have six figures. And he says, well, over
here in your retirement, do you think I could fill
that in? Well, of course you could, Lord. And so
I think it's those moments where it might be $20
(12:29):
cash one day, and it might be thousands of dollars
where God just keeps reminding us. I want you to
know I've got plenty. Yeah. The story with John I
have to tell you is, you know, uh, you know,
I would get my bank statements and it was like, miraculous.
You know, I'd go meet for lunch and then I'd
get my bank statement. I had $5,000 in it again.
(12:50):
Then I'd give it all away and I'd go for lunch,
and then I'd have $5,000. It didn't matter how much
I spent or what I did, it always got filled up.
And I it just reminded me that when God can
find people that are generous and we give away our
money and our time, and we do it with a
heart not to earn or prove or compare, but just,
(13:11):
oh Lord, you love people. He just has an amazing
way to keep refilling up because he can't find all
that many people who recognize it's all his and are
open handed with it. And when he does, he longs
to bless.
S1 (13:24):
Mm. Boy, he sure does. We've got just about 30s
left for someone out there today who perhaps is at
the other end of the spectrum. They feel like they
don't have much to give, and they want to honor God.
What would you say to that person?
S2 (13:38):
Start small. Um. It's your view of God that needs
to change, not your circumstances. I thought honestly that once
I get rich, someday, if I ever did, or if
I was more holy, then I'll start to give. You
need to practice generosity today. Do what you can, where
you're at, and watch God grow your heart, and often
(13:59):
will take care of a lot of other needs as well.
S1 (14:02):
The genius of generosity is that when we give, we
don't lose. We actually gain. God designed generosity to free
our hearts, deepen our faith, and multiply joy. What a treat.
Thanks for being with us, my joy.
S2 (14:14):
Bye bye.
S1 (14:15):
That's Chip Ingram, founder, teaching pastor, and CEO of living
on the edge. Learn more at living on the edge org.
Back with your questions after this, stick around.
S3 (14:37):
The opinions offered during this program represent the personal or
professional opinions of the participants, given for informational purposes only.
Any information provided is not intended to replace advice from
a financial, medical, legal or other professional who understands your
specific situation.
S4 (15:01):
So glad to have you with us today on Faith
and finance live.
S1 (15:04):
I'm Rob West. We're taking those calls and questions from
you at 800 525 7000. That's 800 525 7000. We've
got some lines open. You know, this is a bit
of a wonderful but unusual week, at least from a
broadcast standpoint. And reason being, we're off our rhythms, right?
A lot of us wrapping up work. Some may already
(15:25):
have some time off, others planning for maybe doing the
last minute cleaning before a big group arrives at your home, uh,
for the Thanksgiving holiday. Uh, and as a result, it
changes our listening habits on the radio. And so there's
going to be a little more room today for you
to get that question. And perhaps you've not been able
(15:46):
to get through in the past. Well, today is an
opportunity for you. We've got some lines open. And so
if you have a financial question, something you've been wrestling
with in your financial life and you'd like to talk
about it, I'd love to chat about it with you.
Just call 800 525 7000. Again that number is 800
525 7000. We'll get to as many calls as we
(16:06):
can between now and the end of the broadcast before
we head to those phones in the news today. Well,
mortgage rates have, uh, well, they're approaching 6%. We've actually
heard that there are some rates out there at 5.99%
for a 30 year fixed rate, uh, 5.5 for a
(16:27):
15 year. Now, most of them, like if you go
to Bankrate or NerdWallet, you'll see them around, uh, six
and a quarter, but even six and a quarter, uh,
we haven't seen these rates in quite a while, and
that's clearly catching the attention of a lot of homeowners
and potential buyers, not to mention those interested in refinance.
Here's a few things to keep in mind. First of all,
(16:49):
lower rates, of course, can reduce your monthly payment or
shorten your payoff timeline. Improving long term stability. Refinancing only
makes sense if the savings outweigh the closing costs, so
run those numbers carefully. I generally say you want a
point and a half at a minimum in terms of
(17:09):
reduction on that interest rate, and you need to be
willing to stay in that home five years. Now, can
you make the numbers work if you stay in the
home three years, perhaps. Uh, what if you only get
a 1% reduction, you still might be able to make
it work, but you're going to need to really crunch
those numbers. That's why I think 1.5% in five years
is a better target. And here's why. You know, the
(17:31):
cost of the refinance can easily run you 3%. So
on a quarter of $1 million mortgage. I mean, we're
talking 7500. If it's not 3% and it's 4%, well,
that's $10,000. And you need to be able to have
$10,000 in savings in terms of interest before you sell
that property. Now it's easy to say, well, you know,
(17:54):
on a 30 year mortgage, even if I get three
quarters of a point, I'm going to save tens of
thousands of dollars. Yeah, but that's assuming you stay there
for the next 30 years. Most people don't do that.
And so you need to make sure that you're going
to be there long enough, and you'll get enough interest
savings to cover the cost of the refi, or else
you might as well not even do it. So just
(18:14):
keep that in mind as you're thinking through it. Also,
here's something people miss. You know, in an amortized mortgage,
the vast majority of your payment at the beginning of
your amortization schedule. So when you start those 30 years
is going to interest. Very little is going to principal.
And then over time it flips in that last payment
(18:34):
you make, you have a very small amount going to
interest and almost the whole check going to principal. That's
just the way an amortized loan works. So what does
that mean? Well, if you're five years into that mortgage
and you've started to move in the direction of a
larger portion going to principal out of every payment, and
then you start that over, well, you're really resetting that.
(18:56):
And that's going to hurt you in the long run,
because again, you're beginning back in that place where the
vast majority is going to principal. So what do you
do about it? Well, one option is you go ahead
and get that 30 year mortgage five years in, even
though you only had 25 left, but pay it like
it's a 25. So that would be where you'd go online.
(19:17):
You'd find a free mortgage calculator to run an amortization schedule.
You'd put in your loan balance and your interest rate
and all the details, and then you'd say, how much
do I have to add extra per month to make
this 35 or 25 or this 30 year, a 25
year your mortgage, it would tell you, and then you
could just make that your monthly payment. Now, the benefit
(19:38):
of still having the 30 year mortgage is if you
got into a real financial hardship, you could drop back
to that smaller 30 year payment, which is a real benefit,
because if you were in a really tight spot, you'd
be glad you had the option to make a lower payment.
So just a few things to keep in mind. Now,
if you're buying, don't let lower rates tempt you into
(19:58):
stretching your budget. It's easy to do. Keep that payment
in a range you can sustain with peace. That's generally
no more than 25% at the most 30% of your
take home pay toward principal interest, taxes, and insurance. Uh, finally,
I would say consider consider the long term implications. You know,
a lower rate is helpful, but a sound financial plan
(20:21):
matters more than a moment in the market. So just
take it with a grain of salt, recognizing, okay, rates
are headed down. This is a good sign for me
if I've either been on the sideline waiting or I'm
up near 8%, and if I could get it at six. Uh,
you know, that's two points lower, and especially if I'm
(20:41):
planning to stay put for a while or, you know,
I want to accelerate the pay off. Uh, you know,
all of those are good things that will work in
your favor. Where are rates headed from here? Nobody knows. Uh,
you know, most estimates are that we'll finish, uh, 20, 26.
You know, maybe in the mid fives. So if we're
at six right now, we're not expected to go a
(21:01):
whole lot lower. A lot of that is just going
to be a result of inflation. And what happens with
interest rates and the Federal Reserve. Uh, a lot of
people counting on the fact, including the market, that we're
going to get another rate reduction here in December. It
remains to be seen. Uh, whereas it was pretty much
a foregone conclusion. That's not the thinking necessarily right now.
(21:22):
It may happen and may not. A lot of economists
put it at about 50%. So we'll certainly keep an
eye on that. All right. Here's what we're going to do.
We're going to take a break. All the lines nearly full.
So we've got a lot of great questions coming up.
We will dive into those right after this break. And
we're going to take as many calls as we can
between now and the end of the program. So hopefully
(21:42):
we can help you think about applying God's wisdom to
your financial decisions. I'm Rob West. This is faith and
finance live here on Moody Radio. Quick break and then
back with much more. Stay with us. Thanks for joining
(22:10):
us today on Faith and Finance Live. Let's dive into
your questions. Today we're headed to Illinois and Alaska. Minnesota.
But first green Bay, Wisconsin. Hi, Dan. Go ahead.
S5 (22:20):
Well good afternoon, Rob. Thank you for taking my call.
I really appreciate faith and finance and how your entire
team ministers to so many people.
S1 (22:28):
Well thank you, Dan. That's very kind.
S5 (22:30):
You're more than welcome. Let me give you a little background.
Then I'll ask my question. My wife and I are
two years of age, and we're planning on retiring at
age 65. Our home, our automobiles are free and clear.
We also have $100,000 in liquid cash. And by God's grace,
we've accumulated just over $1 million in our IRAs. 300,000
of that is invested in Roth. And the balance is
(22:52):
in a traditional IRA. 100% of those accounts are invested
in mutual funds at a moderate level of risk. And
our question is simply this with the market at record highs, tariffs,
inflation and just the overall volatility in the market, how
concerned should we be of a market correction and how
or and should we consider diversifying with bonds. Or should
(23:15):
we simply adjust our existing mutual funds with a more
conservative approach given our age?
S1 (23:21):
Yeah. Well, it's a great question, Dan, and I really
appreciate the thorough nature of it. Um, when you say, um,
you essentially with your million dollar portfolio, I think you said, um,
you have all of it in mutual funds. And am
I hearing that those are all stock funds, or do
(23:41):
you feel like that some of them at least are balanced,
meaning they have some bond exposure?
S5 (23:46):
No, they have zero bond exposure. There are 90%. I
think it's 92% are all in equities. It's an American
growth fund is what it is.
S1 (23:54):
Okay. Got it. Yeah. Yeah I think this is a
great opportunity for you to begin to change your allocation. Um,
you know, because when we get to this point, I mean,
you've accumulated quite a bit of a nest egg and
you want to think about not only continuing to grow
it because one of the risks you have moving forward
(24:15):
is what's called longevity risk, meaning you're going to outlive
your money. And one of the ways we manage that
is by making sure your withdrawal rate is appropriate. And
we could talk about that, But you've probably heard me
say that, you know, a typical, at least based on
the studies that were done by a guy named Ben
Gin a few decades ago, is where we got the 4%
(24:36):
rule that if you take only 4% a year. So,
you know, in your case, we'd be talking, uh, you know,
40,000 a year. If we take no more than 4%,
you know, you should be able to maintain that principle
balance over time and basically have the full amount available
to pass on to heirs or give away at death.
And he recently revised that, I think his new number
(24:58):
when his new book that just came out is, is 4.7%. Now,
that's just a rule of thumb. It's all it is.
It doesn't mean that you're guaranteed anything. It doesn't mean
it's the right withdrawal rate for you. I think it's
a matter of just really thinking through, you know, what
is appropriate for us. Um, you know, given our needs. Um,
(25:18):
but the second way we manage that is in addition
to making sure, you know, that we have the appropriate
withdrawal rate. I think the other piece is just making
sure we have the right mix of investments, making sure
that we're not too aggressive. And, you know, at 60,
you know, we used to use 100 minus your age.
People are living longer. So the new rule of thumb
(25:40):
is 110 minus your age. That's the portion the percentage
that should be in stocks and then the remainder in bonds.
So let's call it I know you're 62 but let's
call it 60. That would be a 50 over 50
portfolio where you got 50% in stocks, 50% in bonds.
And you know the nice part about that is, you know,
so let's say, you know, there was a market crash.
(26:03):
And usually I mean, we're talking, you know, a 20%
decline in the market in a very short period of time. Uh,
if that were to happen and you're 50% bonds, 50% stocks,
you know, all the all of a sudden that 20%
quote unquote crash, you know, only results in you being
down 10%. Now that's significant. That's $100,000 on your portfolio.
(26:26):
But it's a paper loss. And because you're drawing a
with a very modest amount, you're just pulling the income
anyway largely off the bond portion. And you wouldn't you
or your advisor wouldn't need to sell any of those
stocks that are down during that market crash. And 100%
of the time, because we're basically sitting at all time
(26:49):
highs right now, 100% of the time. We've had corrections
or crashes in the past, whether it's 1929, 1987, the.com
bubble burst. And, you know, in 2000, um, you know,
the pandemic, uh, 2008, 2009, the great financial recession. Um,
(27:09):
you know, in every one of those cases, the market
has recovered. And what you would be able to do
at that point is let your portfolio recover over time
without selling anything. And I think that's one of the reasons,
especially given where we are right now and all the
reasons you mentioned to be concerned about where the market
might be headed from here, uh, for you to begin
to transition to a more properly diversified portfolio that fits
(27:34):
with your age so that, you know, you still get
plenty of upside if the market continues to do well,
but you're adding some more income with the bonds, you know,
and in that bond portion, it may not be all bonds.
You could have some laddered CDs, you could have some
precious metals. You could even have, you know, somewhere between
(27:55):
1 and 3% and bitcoin, uh, you know, because it
acts kind of like a store of value. And so
there are other ways, even some real estate through real
estate investment trusts, all of that could fit into that
more fixed income portion that, um, you know, I think
could round out a nice portfolio, take some of the
pressure off you. And here's one of the keys is
(28:17):
you'd have to just go ahead and accept that at
some point, you know, during the next however long the
Lord has for us. But it could, you know, easily
be three decades or more. There's going to be a
major correction, if not a crash. And the key is
you got to be ready for it and know that
you're prepared for it. And that's why you've invested the
way you have such that you wouldn't feel compelled to
(28:40):
go in and start selling a bunch of things while
they were down. You would just need to already be,
you know, in your mind, settled around the idea that, no,
we're taking a rules based approach to this. We like
what we own. We like our mix of stocks and bonds.
And so we're going to weather the storm, and we're
going to trust that history is going to repeat itself
in this market eventually will recover and move to new highs.
(29:02):
But give me your thoughts on all that because I
know it was a lot.
S5 (29:06):
No, it was a lot. But it's fantastic. And it
kind of confirms, uh, much of what I've been, I'll say, considering.
And it just makes me nervous. I think that, you know, I,
I know that God's really blessed us. And as far
as we're concerned, you know, we want to be able
to honor God in and all that he has, in
(29:26):
a sense, put us in charge of and just to
be really good stewards. So I think diversifying that, uh, with,
I'll say, a 6040 or 5050 bond at this point
in time at age 62 is probably a good idea.
S1 (29:38):
Yeah, yeah, I agree, I think that'll serve you well. Also,
go back and listen to, uh, you know, the interview
I did with Mark Biller late last week, you know,
he was talking about how he's expecting and and actually,
there's a great article on this at Sound Mind Investing
org that I think you might enjoy. Um, it's called, uh,
(30:00):
bulls and bears, cyclical and secular. And what he's talking
about there is really their approach to what he's expecting
in the bond market over the next decade. He's expecting
the next 1 to 3 years as rates are coming
down to be good, but perhaps not as good long term.
And so there's some ways you can take that bond
portion and add some other things in like precious metals and,
(30:23):
you know, real estate, you know, that might round that out.
But I think that article is sound mind investing. Aug
could be helpful. The other piece is and by the way,
that was November the 20th. The other piece is you
could always connect with a certified Kingdom advisor to take
over management of this. If you'd be, you know, at
this point happier with somebody else that could take responsibility,
you'd be delegating it to them. You'd have to be
(30:44):
comfortable with that and you'd pay for it. But I
think with this nest egg, you might have a lot
more peace of mind. If you wanted to do that.
Just go to find a.com. Dan, thanks for your kind
remarks about the program and for joining us today. God
bless you. We'll be right back. Great to have you
(31:09):
with us today on Faith and Finance Live. We're going
to get to as many calls and questions as we
can today. It was a big day here at Faith
fi we got from the printer, uh, the first copy
of our ultimate Treasure, my new 21 day devotional that
comes out early next year. Now, it wasn't the actual book.
It was the first print print run for us just
(31:30):
to look at, uh, you know, all the margins and
have one final look at it before it goes to press.
And and then we'll get the actual hardback books, uh,
in late January. But I can't wait for you to
get your hands on it. It's, uh, really the first
time I've put together a collection of what I believe
are the foundational ideas in Scripture that I believe everybody
(31:53):
needs to know, not because it comes from me, but
because it's found in God's Word. In terms of being
a faithful steward. It's really these 21 bottom lines. And
we've organized it as a 21 day devotional so that
if you spend 21 days journeying with us through God's
Word and it is full of Scripture, I mean, we're
all over the Old and New Testament over these 21 days,
(32:15):
but I think you'll come away with an understanding of
the heart of God from Scripture related to your role
as a steward of God's resources. It's called our ultimate treasure,
a 21 day Journey to faithful stewardship, and it'll be
out in the first part of next year by late January.
And if you make a gift to faith by here
(32:36):
before the end of the year, a gift of any amount,
we will be able to send you a copy. And
so just head to our website. Faith that's faithful. Not
only will you get a copy of our Ultimate treasure,
but every gift is doubled before 1231 because of some
generous friends that are matching every gift. It's going to
(32:57):
be beautiful. I mean, this hardback devotional is one that
you could put out on the coffee table in your
home and, uh, it would be something people would enjoy
flipping through as well. So really excited to get it
in your hands. All right, back to the phones. We
go Minnesota Diane. Go ahead.
S6 (33:14):
Thank you so much. I sure appreciate your program and
your amazing financial expertise in all of these matters. So
my my question is in reference to, um, my husband
and I are retirement age and we have four different
retirement plans. Three of them are through an employer and
the other one is through an A Vanguard IRAs. So
(33:35):
we are wondering, um, we it's totals around 200,000. Is
it wise to consolidate them? And if yes, is it
wise to consolidate them into the vanguard IRA?
S1 (33:49):
Yeah. Well, let's start with the first part of that. First. Yes.
As you get close to retirement, in my view, consolidating
accounts is almost always a smart move. It just makes everything, Diane,
easier to track, easier to manage, and ultimately easier to
withdraw from once you actually retire. So I think it's
(34:11):
a great move, not to mention, it's easier to make
sure that you have the right mix of investments, because
when you have multiple accounts and each have their own
investments in them, you could end up not hitting the
right target mix of investments that's appropriate for your age
and risk tolerance. Just because it's a little harder to
do when you've got to factor in the investments across
(34:33):
multiple accounts versus everything being in one and being able
to get, you know, see it all in one place,
including how the various investments bucket out in terms of
bonds and stocks and precious metals and other types of investments. So, yes,
I like the idea of consolidation. Now with retirement accounts,
they have to stay individual. So your 401 K could
(34:56):
go in your IRA, but your husband's 401 K could
not go in your IRA. So you're probably going to
end up with it at a minimum two accounts. But
any of the accounts that are titled in your name
could be consolidated into one now. Does it make sense
to use the Vanguard IRA? Well, Vanguard is a solid,
(35:16):
low cost provider. They have great index funds and and
excellent retirement tools. Um, you know, they're they're one of
the oldest in this space in terms of the low
cost providers. But I think that's really going to come
down to Diane. How do you want to manage these funds?
Are you all going to be the ones to make
the buy and sell decisions? And if so, you could
(35:39):
use Vanguard. You could use fidelity. You could use Schwab.
Any of those would work. Um, I think you really
need to make the the management decision first, because if
you decided to use an investment advisor, someone who would
take discretionary investment authority over the account charged as a fiduciary,
meaning they have to put your interests first. They have
(36:01):
to understand your goals and objectives and risk tolerance and
income needs and all those things. But then he or
she would make the buy and sell decisions for you. Well,
then they're going to want to open those IRA accounts,
if that's what they are at, wherever they custody their
client's assets. And then you're going to roll everything over there.
(36:22):
So before you start consolidating everything in Vanguard, I would
make that decision about, you know, whether you're going to
manage it yourself or have somebody else do it. Does
that all make sense?
S6 (36:32):
Certainly does. Is there, if you don't mind a follow
up question, is there a threshold of a dollar amount
where it would be wise to go to a financial
manager or financial planner or.
S1 (36:43):
Yeah, I mean, I think once you get over 100,000,
it's probably worth thinking about how many investment advisors are
going to have minimums, and some of them are going
to be 250,000. Some of them might be a half million.
You might even find some advisors that have a minimum
of a million or more. But there's plenty that would
take the account, you know, starting at 100,000 and up,
(37:04):
typically under 100,000. You know, most investment advisors. Their models
just don't work for them to manage it for you.
Because the fees are based on the assets under management.
There's just not a fee, enough fees there, and they
can only take so many clients. I mean, a typical
advisor can only serve 50 families on average, and so
there's only so many slots. Um, so what I would
(37:27):
do is, you know, if you've got over 100, certainly
if you've got over 200,000 in total among all the
investment accounts, then I would say, yes, it's time to
start looking at an advisor and I'd go to find a.
Com maybe interview 2 or 3 certified Kingdom advisors there
in Minnesota to find the one that's the right fit.
S6 (37:47):
Perfect. Okay. Thank you so much. God bless. That was
very helpful.
S1 (37:50):
Good. I'm glad to hear it Diane. Yeah. Happy Thanksgiving.
Thanks for your call today. Uh, out to beautiful Alaska. Connie.
Go ahead.
S7 (37:59):
Good morning.
S1 (38:00):
Hi, there.
S7 (38:02):
Hi. Well, you are talking with someone who is very
uninformed compared to your last two callers. My husband and
I are both 70. My husband is retired and a
cancer survivor. I am still working and probably will be
for the next five years, maybe a little longer. And I,
(38:25):
we have been blessed to pay off our home, pay
off our vehicles, and now have a nest egg of
about 350,000. Two and a half of that is in
CDs and the other is in cash. And at this
point I don't. I've not been raised around the kind
(38:49):
of thing that you're talking about. So I don't know
anything about stocks or bonds or or that type of thing.
I'm just wondering if we should be taking any risk
at this point, or if we should just go on
with these place money the way it is currently placed.
S1 (39:07):
Yeah, it's a great question. And, you know, the ultimately
you are the steward, Connie, you and your husband. And
so before the Lord, you all need to make these
decisions as to how you want to manage God's money.
The benefit of investing is investing is ownership. So you're
owning real companies. And, you know, those companies are providing
(39:27):
goods and services for hopefully, the good and flourishing of mankind.
Of others, it's a part of God's design. Uh, business
is what provides capital or investment is what provides capital
to business. Uh, you know, and that's what, uh, it
creates a virtuous cycle. And bonds are essentially debt where
(39:49):
you're being, you know, loaning money and they're paying you
an interest rate. But in either case, you're putting God's
money to work to be productive, hopefully in, in God
honoring ventures. And you get a return from that. And
what that does is it accomplishes two things. Number one
is there's a loss of purchasing power that's happening every day.
(40:12):
You know, your dollar is under a mattress and maybe
that's not where it is, but let's say it is
for my example here because with inflation and we could
talk about whether or not there should be inflation. But
there is, there always has been for you know, and
it's getting, it's higher than it has been in the last,
you know, 20 or 30 years right now with inflation,
(40:32):
you're the purchasing power of your dollars are losing purchasing
power over time. So one of the benefits of investing
is you offset that by growing it number one. And
number two is you have something called a longevity risk,
which is the idea that people are living longer. I mean,
once you're in your 70s as a 70 year old
woman living in the United States of America, you have
(40:56):
a 1 in 3 chance of living to age 90.
You have a 1 in 10 chance of living to
age 95. So we're talking about you. This money needing
to last, you know, 20 to 25 years, potentially or more. Now,
unless the Lord, uh, you know, comes back and then
it doesn't matter. But if he doesn't and he has
(41:16):
a plan for you here, uh, that could be well
into your 90s. And so you can still take a
long term perspective even in your 70s. Now, at 70
years old, what would be the right mix of investments? Well,
as a starting point, and that's all it is. It
would probably be, you know, this idea that you'd put
20 to 40% in stocks for some growth and then
(41:39):
you'd put the the balance, call it 60 to 80%
in bonds or cash for safety and income. And in
that bond portion, maybe you'd add in a little bit of, uh,
precious metals and, you know, maybe even some real estate
through a real estate investment trust, which you can buy
and sell like a stock. But that would be, generally speaking,
(42:01):
what's considered a properly diversified portfolio, where you take what
God has given you, you'd have a portion of it
that's growing to offset that longevity risk and inflation. And
then you'd be generating some income in the bonds and
cash portion, and you'd you'd still be relatively safe. So
even if the market was down 20 or 30%, your
portfolio might be down 5 to 10. Does that make sense?
S8 (42:25):
It's beginning to.
S1 (42:27):
Okay, here's what I want to do. I'm going to
send you a book called The Sound Mind Investing Handbook.
And maybe, uh, you know, over this next, uh, five
weeks of Thanksgiving and Christmas, you and your husband sit
down and read it, think through it, and then why
don't we talk a bit more in the new year?
And the other option is you can connect with a
certified Kingdom advisor. And we have some great ones in Alaska.
(42:48):
Hang on the line. We're going to get your information.
I'll send you that book. God bless you, Connie. Happy Thanksgiving.
Faith and finance is a partnership between Moody Radio and
Faith by Taylor, Tara, Josh and Dan, the amazing team today.
We'll see you next time.
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